Salary income is the sum of the basic salary + HRA + Special Allowance + Transportation Allowance + any other allowances. Some aspects of your salary are tax-free, such as phone bill reimbursement and leave travel allowance.
How is PAYE calculated In South Africa?
PAYE on regular income is calculated by calculating the tax on a projected income for the year (known as the annual equivalent) and then de-annualising the tax to determine the tax payable for the period.
Is tax calculated on basic salary?
In this case, income tax is calculated based on the employee’s gross salary and is deducted as a source by the employer. Furthermore, an employee’s basic salary should be at least 50-60% of his or her gross salary.
How much salary is taxable
The tax amount you must pay to the Income Tax Department is the amount after deducting all applicable deductions and TDS. If your total income is less than R25,000, you do not have to pay income tax. If your income exceeds R25,000, you must pay income tax in accordance with your tax bracket.
